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Marketplace®

Daily business news and economic stories

Farmers push Congress for new farm bill

In many cases, commodity farmers will sell this year's harvest at a loss. Advocates say the current farm bill doesn't account for rising operational costs.
In many cases, commodity farmers will sell this year's harvest at a loss. Advocates say the current farm bill doesn't account for rising operational costs.
Patrick T. Fallon/AFP via Getty Images

Congress came back from recess this week to a letter from more than 300 agricultural trade and advocacy groups saying the time to negotiate a new farm bill is now. Congress’ extended deadline to refresh that massive spending package is creeping up at the end of the month. 

Crop insurance and other agriculture safety net programs will make up just a small portion of that spending. But farmers say they need a new bill by the end of the year because a downturn in the agriculture economy is causing some pain.

Commodity farmers across the country are getting ready to harvest their fall crop. And in many cases, sell it at a loss. 

“The prices are … not so great,” said Krista Swanson, lead economist at the National Corn Growers Association.

She said demand for agricultural commodities has been steady. Problem is, there’s too much. 

“The story here is that we are really good at growing corn,” she said.

High yields for that crop, plus soybeans and wheat, are driving down prices. 

Swanson said that makes passing a new farm bill even more urgent: “It provides a risk management safety net for farmers,” she said. 

A safety net that hasn’t gotten an update since 2018

“So much has changed in our market since that time,” said Amy Hagerman, an agricultural policy specialist at Oklahoma State University. 

For one, farming has gotten more expensive, she said. “Machinery and repair costs have been going up steadily. Chemicals have been very expensive. Interest rates are higher.”

The government can provide crop insurance payouts when prices bottom out, but Kristen Owen, an analyst with Oppenheimer, said the farm bill’s current price thresholds don’t reflect higher production costs. 

“It’s a pretty low bar right now. Prices would have to fall really really low in order for those payment programs to pay out,” she said.

Owen said a new farm bill won’t make farmers whole after 2024’s losses. And she sees current conditions as more of a normalization anyway, after the agricultural sector enjoyed record high prices and government payments during the pandemic. 

“It just feels a little worse because we were coming off of such high levels previously,” she said.

Movement on the farm bill could go a long way to boost farmer sentiment, while kicking the can again could tank it even more, Owen said.

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